Australian Pacific Coal hit with Dartbrook default notice but lender Vitol holds off on action
Australian Pacific Coal (AQC) has been issued a notice of default by senior lender Vitol over its Dartbrook coal project in the New South Wales Hunter Valley, but the Singapore-based commodities giant is holding off on enforcement action as the miner moves to meet final conditions attached to its financing deal.
In a statement to the ASX on Monday, AQC confirmed that two remaining conditions subsequent (CS) under its senior secured finance facility remain unmet, triggering events of default under the loan. Despite this, Vitol, acting through its facility agent, is not moving to accelerate or enforce the loan, instead reserving its rights while reaffirming its support for the project.
The defaults relate to operational and administrative milestones that AQC said were within reach. One condition requires the Dartbrook joint venture to rail 20 000 t of coal within a consecutive 30-day period. AQC said the joint venture (JV) had already started railing washed coal and expected to meet the threshold shortly as it ramped up activity at the site.
The second outstanding condition involved the registration of the Trepang Lease with the NSW Land Registry Service – a process the company said was largely procedural.
“Notwithstanding the receipt of the above notice, Vitol has expressed its continued support and commitment towards the Dartbrook project,” AQC said in its update, pointing to a $4.2-million funding injection from the trader last week as evidence of ongoing backing.
The Dartbrook mine has about 150 000 tonnes of run-of-mine coal stockpiled and is preparing for export sales once steady-state production is achieved. All sales and logistics must be arranged through Vitol, which holds exclusive marketing rights for the project.
AQC said the majority of conditions tied to the finance facility had already been met and that it was confident the remaining issues could be resolved in the coming weeks.
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